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Domestic markets likely to get gap-up opening on Thursday

Indian markets ended lower on Wednesday for the fourth consecutive session amid selling in banking, financials, auto, metals and pharma counters. Today, the start of session is likely to be gap-up following rally in US and other Asian markets. Some support will come as Veteran banker K V Kamath expressed optimism that India's sovereign rating would go up on the back of efforts being taken by the government to push economic reforms. Traders may take note of report that Oil Minister Dharmendra Pradhan said India and the UAE on Wednesday discussed ways to strengthen energy cooperation, despite the nation asking its refiners to reduce their reliance on Middle Eastern oil. Besides, as per a report, even as concerns rise across the globe on the safety of the AstraZeneca-Oxford vaccine, India has found it safe, saying the nationwide inoculation drive can continue. The AstraZeneca-Oxford vaccine - called Covishield in India - is manufactured in the country by Pune-based Serum Institute of India, the world’s largest vaccine maker by volume. Though, concern over rising domestic Covid-19 cases may cap the gains. India reported 35,482 fresh Covid-19 cases on Wednesday pushing the overall tally to 11,438,464, according to Worldometer. The death toll from the deadly infection jumped to 159,249. Maharashtra reported as many as 23,179 new cases of coronavirus. There will be some buzz in the telecom stocks reacting to their monthly subscriber data. Banking stocks will in focus as a survey carried out by FICCI-IBA showed that asset quality of banks, which saw some improvement in the second half of 2020, is likely to worsen during the first six months of 2021. There will be some reaction in aviation stocks with Indian aviation regulator DGCA said around 78.27 lakh (7.8 million) domestic passengers travelled by air in February 2021 which is 36.71 per cent lower than the corresponding period last year. Meanwhile, the Centre is proposing to waive off new vehicle registration charges for customers who have scrapped their older vehicles and are submitting a scrapping certificate. The draft rules can come into effect from October 1, 2021.

The US markets ended higher on Wednesday following the US Fed’s positive economic growth outlook. Asian markets are trading in green on Thursday after the Federal Reserve pledged to keep monetary policy and rates unchanged and projected a rapid jump in U.S. economic growth this year as the COVID-19 crisis eases.

Back home, Indian equity benchmarks dropped for the fourth consecutive day on Wednesday, as concerns pertaining to recent rise in Covid-19 cases in various parts of the country and high inflation continued to weigh on investors’ sentiments. Additionally, weak cues from global markets ahead of FOMC meeting outcome also caused selling in domestic equities. Markets made cautious start, as traders remained anxious with India Ratings and Research (Ind-Ra) in its latest report stated that the performance of unsecured assets classes, such as microfinance loans, unsecured business loans and consumer loans, is worsening with deteriorating financial conditions of borrowers. For secured asset classes, it has a stable performance outlook given the recovery in the economy in FY22. However, markets witnessed some buying in late morning deals, as some support came with the commerce ministry's preliminary data stating that India's exports grew 17.27 percent to $14.22 billion during March 1-14 as compared to the year-ago period, showing healthy signs of revival. The key sectors which recorded a healthy growth in exports include engineering, rice, gems and jewellery. But benchmarks once again fell into red terrain in afternoon session and ended over a percent lower, as traders were worried as Union Health Secretary Rajesh Bhusan warned that Maharashtra was at the beginning of a second wave of the COVID-19 pandemic. In a letter to the Maharashtra government, said that a report by the Central team that had visited the state from March 7-11 found that there was very limited active effort to track, test, isolate cases and quarantine the contacts. There was some cautiousness too as India reported 28,869 fresh Covid-19 cases on Tuesday pushing the overall tally to 11,438,464, according to Worldometer. The death toll from the deadly infection jumped to 159,079. Traders overlooked reports that the retail industry's business is on the brink of full recovery as it achieved 93 per cent of the pre-COVID sales in February. Finally, the BSE Sensex fell 562.34 points or 1.12% to 49,801.62, while the CNX Nifty was down by 189.15 points or 1.27% to 14,721.30.   

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